New Delhi, Apr 29:
Auto components maker Varroc Engineering Ltd (VEL) on Friday said it is selling its four-wheeler lighting systems operations in the Americas and Europe to France’s Compagnie Plastic Omnium SE for 600 million euros (over Rs 4,830 crore).
The divestment is part of VEL’s strategy to align its resources with the high value and high growth primary markets in China, India, and the two-wheeler sector globally, the company said in a statement.
VEL has signed a securities purchase agreement (SPA) with Compagnie Plastic Omnium SE of France for the purpose.
“The Euro 600 million transaction will see Varroc divesting its lighting system operations in the USA, Brazil, Mexico, Poland, Czech Republic, Germany, Turkey, and Morocco,” it said.
The company, however, said it is retaining its four-wheeler lighting operations in Asia.
“Varroc will also continue to operate its China JV and other international two-wheeler businesses in countries like Italy and Vietnam and global electronics businesses in Poland and Romania,” the statement said.
“Our immediate goal is to be future-ready with continued profitable growth in emerging sectors like the EV and high technology electronics. The divestment of our passenger car lighting operations in the Americas and Europe will be a win-win deal for Varroc and Plastic Omnium,” VEL Chairman & Managing Director Tarang Jain said.
He further said, “for us, we unlock great value for all our shareholders, employees, and business partners as we plan for our next level of growth in the fastest-growing economies and auto sectors in the world. We will also continue to invest in our teams and people as we embark on the next phase of our growth.”
The planned divestment of Varroc’s 4-wheeler lighting systems businesses in the Americas and Europe will ensure enhanced shareholders’ value, sustainable growth, and further development of its R&D facilities and engineering capabilities, the company said.
“Varroc Lighting Systems is a strategic addition to our business that will provide us with an extensive lighting product portfolio, a balanced footprint across best-cost countries and cross-selling opportunities. Building on our operational excellence, financial strength, and long-term vision we have identified clear levers to bring VLS to best-in-class operating performance,” Plastic Omnium CEO Laurent Favre said.
Varroc said its lighting systems and other businesses in India, namely design, manufacture, and supply of a diverse range of polymer, electrical-electronics and metallic components will continue to enjoy a leadership position in these business segments. (PTI)
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